BG5150

Now, now. Let's play like pretty children. (And that's "pretty" with an "r")

Most record keeping companies have forms that provide for the transfer of assets from a deceased person's account to a beneficiary (or beneficiaries). Usually, the paperwork is completed by the beneficiary and sent to the plan sponsor for authorization. Once the plan sponsor authorizes it, the transfer is done and the beneficiary can have control over that part of the money. As for the naming of the accounts (I'm sure that QRDOphile's response was tongue in cheek, but...): True, the name ont he account doesn't really matter, but the underlying identifier of the account is the SSN. It is needed so proper tax reporting can be done. The account number and name are arbitrary, but it just make sense to keep the true name or the participant/bene attached to the account(s) for which the correct SSN is the identifier.

Does this help? http://benefitslink.com/taxcode/

My vote is $10,000. You do not reduce the annual additions by the refund amount.

We have never had any problems disaggregating participants who were under 21 or would have entered the plan the next plan year if the plan used semi-annual entry dates. Would the test have passed if everyone was included? Some practitioners just automatically disaggregate the populations as a default. If the plan will pass with everyone in it, then all is good. For the excludable people: is the census data correct for those people? Be sure they are really excludable. Also, for "service less than a year": You could actually have people with a year of service who could be excludable. Say a person is hired in August 2006. One year anniversary is August 2007. With monthly entry dates, the person would come into the plan on Sep 1. With semi-annual entry dates, the person would come into the plan 1/1/08. So even though the person is eligible for the plan and has more than a year of service, he or she can be tested separately.

If your money is with a reputable company, you should only really need your SSN and the name of the plan. The operator should also ask some followup identity questions like address, date of birth. Then he or she should be able to look up your account and give out information. Do you maybe have access to your account online? Check your latest statement, the information you need might be right there. The plan ID could be a couple of things: The IRS plan number, which is usually 001, 002, 003... or the plan number the record keeper uses to identify your previous employers accounts. The first you probably wouldn't need.

I just throw my stuff out when I'm done with it. I just recently tossed the 2006 ADP test and Profit Sharing allocations after I did the 2007 work. Plus I throw out enrollment & distribution forms after they are processed. And when I get a plan document, I put the information onto a highlight spreadsheet I created and I lost that, too. Is that bad, then?

1. The instructions for Schedule A says that if a plan elects PPA-simplified reporting I only have to fill in A, B, C & D and jsut the commissions/fees info in Part I. Is there some place on the forms that the plan elects this? 2. For 1(e), persons covered by the contract, who is considered "covered"? Is it the number of people who have a position in the contract? Or is it everyone with an account balance, since, if the plan is participant directed, they could, indeed, be in the contract but decide not to.

Just remember, the ENTIRE loan is the prohibited transaction, not just the amount over the limit...

Eligible employees become participants on their entry dates. A TH contribution goes to eligible participants employed on the last day of the plan year. So if these people did not irrevocably waive participation (ie, decided to defer zero) then a TH contribution would have to be made. Although, it would seem fishy that all the people would opt out totally rather than just not deferring if they had even a halfway decent education session.

Plus, there is no guarantee the guy (or gal) is going to enter the plan on 7/1. People have been know to quit or get fired before their eligibility date.

If this happens to one person, then another, and then another, it would show a pattern of defaults of loans in the plan. Isn't that a qualification issue? Also, if a participant defaults on the loan voluntarily, shouldn't the plan administrator report that to the credit agencies? Theoretically, the PA should be verifying the credit-worthiness of the applicant even before the loan is made. The PA shouldn't just say, Mr. X makes such and such a month, and since it's coming out of his paycheck, we are guaranteed to get the payments. A bank could do that: Mr. X makes such and such, so we should be guaranteed to get our money. But they don't. Why should plan administrators?

That's why I suggested looking at the plan doc. Ours says: ...controlled group relationship as defined under 414(b) or a group under common control under 414© or if there is an affliated service group situation under 414(m). The 414(b) and © regs refer you to Sec 1563(a).

How do you know that he is not a frequent reader of esoteric message boards such as those here at BL?

Does your plan document define what affiliated ER's are, and to what code sections apply? Try those.

Was 2007 the first plan year? If so, many plans are written that you can use an assumed 3% prior-year rate for teh initial year? Or did you already use that in '06?

1. Sometimes I just don't think. 2. Sometimes I spell like that. Behaviour. Neighbour. Colour. Grey. I'm a whack-o. (But an ENGAGED whack-o! Popped the question this weekend; she said YES!)

Two questions: 1) How would it be discriminatory? 2) Are you British? 1. I would think if only HCE's received a Profit Sharing contribution it would be discriminatory. 2. Nope.

I think you would have a problem giving only the HCE's a profit sharing contribution and not the NHCE's even though the latter is receiving a 3% allocation. It would be a separate contribution that definitely discriminates in favour of HCE's!

Until the regs are final, then the current ones are in effect. However, we have heard of plans undergoing audit being called on the carpet for not timely (read: as soon as administratively feasible) sending in deferrals even though they were within the current limits (15th business day following...) And, yes, for small plans (those under 100 lives; the regs do not mention being a schedule I or H filer), the safe harbor is the 7 business days, and after that they are considered late and subject to the excise taxes. Don't forget that interest must be applied to those contributions/payments also. Get ready for a busy 5330 season!

Because the loan itself was one transaction? (just my thought)

Found the answer: Excess deferrals, contributions, aggregate contributions are includable as annual additions. So it would be $29,500

I have a plan in which an HCE had a $15,500 deferral. The plan failed, and he received a $5,500 refund. How much can his PS be for 2007? Is it $29,500 (using the $15,500 of deferrals) or is it $35,000 since there were a "net" $10,000 in deferrals? (Assuming all the other tests will pass)

Attached here for your consideration EPCRS.pdf

For some reason that last sentence made me laugh a little.